Benedictine to offer student loan repayment pledge

Benedictine University at Springfield is taking another whack at mitigating the increasingly high cost of obtaining a college degree with a student loan repayment program.

The school is willing to help its future graduates repay their student loans for up to five years if their debt exceeds their ability to repay.

“We believe our graduates compete very successfully in the job market,” said Benedictine University at Springfield President Michael Bromberg. “This isn’t a burden that we expect to be a challenge for us to meet.”

What the university is calling the “Benedictine Promise” applies to eligible first-time freshmen arriving this fall. It is intended to provide a safety net for participating graduates that will reduce anxiety about debt burden upon graduation.

After these students graduate in four years, Benedictine will cover reimbursement costs for federal student loans if a graduate’s income is below $36,000 a year. Eligible graduates will receive quarterly reimbursements for up to five years after graduating.

The reimbursement is limited to the amount of their scheduled repayment.

Incoming freshmen who want to participate in the loan repayment guarantee will have to pay $50 a semester while attending school to ensure future consideration for the program.

Benedictine admissions recruiters are finding prospective students and their parents reluctant to incur debt to cover private tuition cost, Bromberg said. The concern is that a student’s loan burden won’t be manageable in the early stages of their post-graduate career.

“Studies show that the first five years are the most critical,” Bromberg said. “After five years, their earnings start to go up.”

Tuition and fees at Benedictine Springfield for a full-time student are about $16,500 per year.

Federal student loans max out at about $25,000 for an undergraduate career, Bromberg said. With interest, a student could owe about $28,000 six months after graduating, which is when the loan repayment begins.

Loans generally must be repaid over a 10- to 15-year period.

“We graduate a lot of teachers and social workers, and we’re confident they will certainly, at the end of five years, be able to make those payments,” Bromberg said.

“This new reimbursement guarantee is added reassurance that incoming freshmen should have faith to take that next step to better their lives with us at Benedictine,” he said.

Forty million Americans collectively owe about $1.1 trillion in student loan debt — more than what Americans owe on credit cards.

And studies show the cost of a college education increased 1,120 percent from 1978 to 2012.

Bromberg said part of making college affordable “is the payoff in the career.”

The accredited, nonprofit private Catholic institution recently announced a reduced-price $10,000 MBA program and previously other measures to reduce costs for its students.

Bromberg said President Barack Obama’s challenge to make higher education more affordable “is the right challenge.”

“There are a number of strategies we’re looking to embrace,” he said. “We’re trying to get creative on how we make this happen.”